Biovail's future lies in shareholders' verdict

TORONTO (Reuters) - Biovail Corp's shareholders will know
later this week whether they have plotted a course that could
dramatically change the future of Canada's biggest publicly
traded drugmaker.

The shareholders, who have seen the stock plunge 45 percent
in the past four years, could vote for a new slate of directors
floated by founder Eugene Melnyk and headed by a former chief
executive, who promise a return to the former glory days. Or
they may stay the course with the incumbent slate and a radical
shift in the company's drugmaking strategy.

A decision is expected to be announced at an annual meeting
on Wednesday, though the results may come ahead of that.

Proxy battles have become more frequent in recent years,
but few have seen a founder so passionate about ousting the
present board as Melnyk, who is also the biggest shareholder
with a 12 percent stake.

Melnyk, who founded the company almost 20 years ago and
held numerous posts before stepping down last year, decided to
oppose the board, he says, after losing confidence in Biovail's
corporate strategy and the board's abilities earlier this year.

In Melnyk's plan, a development committee headed by Bruce
Brydon - who was CEO from 1995 to 2001 - will emphasize the
drug pipeline, including a return to so-called "difficult to
manufacture" generic pharmaceuticals and acquiring more
products and technologies.

Meanwhile, the present board under newly appointed chief
executive Bill Wells stands behind its strategic changes
unveiled last month, including shutting down operations in
Puerto Rico and shifting to new treatments for disorders of the
central nervous system.

Earlier this month, CEO Bill Wells said the dissident plan
was "out of touch" with the changing pharmaceutical industry,
and was simply a ploy for Melnyk to make the most of his
12-percent stake in the company.
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